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  • Business - Economy
  • Updated: 1 year ago

FIRS To Control $10bn Tax Leakage By Multinational Companies

FIRS To Control $10bn Tax Leakage By Multinational Companies

 

Executive Chairman, Federal Inland Revenue Service (FIRS), Mr Muhammad Nami, says that the tax collection reform implemented by the federal government under his supervision will help the government observe tax leakage of $10bn by multinational companies.

This was disclosed during the FIRS 2020 management retreat held in Abuja on Friday.

Nami said the tax collection target given to them for the year is N8.5tn broken down into the oil tax target of N3.7trn and non-oil tax target of N4.8tn.

He added that the reforms have already been attended to by four pillars, each of which will not only meet the target but surpass it.

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According to Nami, the four cardinal pillars are set to rebuild the FIRS’ institutional framework, robust collaboration with stakeholders, building a customer or taxpayer-centric institution, and a make the FIRS data-centric institution.

Nami claimed that the Nigerian government is losing over $10bn of tax revenue through illicit profit shifting by multinational corporations operating in the country which could have been applied to critical infrastructure development by the three tiers of government.

He said the $10bn tax leakage accounts for about 20 per cent of the entire $50bn being lost by the African continent.

“Looking at our performance in the recent past, one may look at the 2020 target as ambitious, but I can assure you that it is achievable, especially with the ongoing reforms and business process re-engineering that is taking place in the Service.

“These reforms are aimed at improving both filing and payment compliance, re-activating dormant taxpayers through aggressive intelligence gathering and information sharing, and blocking of leakages.

“In addition, if we are able to detect and block tax avoidance schemes by multinational corporations, that will also go a long way to improve our tax revenue collection. “

“The African Union Illicit Financial Flow Report estimated that Africa is losing nearly $50bn through profit shifting by multinational corporations and about $10bn of this amount, is from Nigeria alone,” he said.

In a statement to participants at the event, Nami said that the FIRS had layed rules down that will help improve service’s output in terms of performance.

The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, tasked the FIRS management to come up with an effective strategy to implement the 2019 Finance Act.

She added that the major purpose for which the Financial Act was implemented is to support the growth of SMEs.

 

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